The new American Airlines wants a branded credit card for post-merger loyalty

Mary Schlangenstein, Bloomberg

- Apr 30, 2013 5:27 am

Skift Take

Loyalty points are a currency all on their own, so expect the new American to to flex its muscles with banks now that it’s the world’s largest airline.

— Jason Clampet

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US Airways Group Inc. and AMR Corp.’s American Airlines are negotiating with banks including Barclays Plc and Citigroup Inc. to provide a branded credit card once they complete a merger creating the world’s largest carrier.

“As we bring two strong currencies together, we’ll have one, stronger currency,” Andrew Nocella, US Airways senior vice president for marketing and planning, said yesterday at a conference. “We are working with all our banks. Every single one wants to work with us.”

US Airways’ loyalty credit card has been handled by Barclays since 2006, while American’s have been issued by Citigroup for 26 years. The cards, which carry the airlines’ names, are valued by passengers because purchases made with them earn credits that can be used to buy tickets.

US Airways and American expect their combination to be concluded in the third quarter, when Fort Worth, Texas-based AMR receives approval to exit bankruptcy protection. The combined carrier, which will retain the American name, will pass United Continental Holdings Inc. as the biggest airline, based on passenger traffic.

The eventual credit-card agreement “will be very lucrative to us,” Nocella told US Airways managers at the airline’s annual leadership conference near its headquarters in Tempe, Arizona.

Kevin Sullivan, a Barclays spokesman, did not return a phone call or e-mail seeking comment outside of regular business hours. Emily Collins, a spokeswoman for New York-based Citigroup, didn’t immediately respond to e-mailed requests for comment.

Visa calling

The new airline will have the second-largest card program in the world, behind only retailer Sears Holdings Corp., Nocella said.

US Airways’ Dividend Miles credit cards are supported by MasterCard Inc. and Visa Inc., as are American’s AAdvantage cards. The combined card would “be the largest MasterCard program in the world,” he said. “Visa is calling me every day.”

United’s loyalty card is issued by JPMorgan Chase & Co., while Delta Air Lines Inc.’s is through American Express Co.

Editors: James Langford, Stephen West. To contact the reporter on this story: Mary Schlangenstein in Scottsdale, Arizona at maryc.s@bloomberg.net. To contact the editor responsible for this story: Ed Dufner at edufner@bloomberg.net.